signs. >> but some. >> things that were worrying. so the background here is one of the economy that still hasn't gotten fully, you know, out of the inflation headache that the fed was fighting. now we've. got this new stimulus towards inflation potentially. >> and in tariffs. and so you know i. >> think we need to. >> be very even. >> in our assessment of where we are here. >> roger. thank you very much. >> thank you. >> what a morning it has been. i'm here in seattle and we should let you know to stay tuned. and for a big interview. it's happening at 230 here in seattle on power lunch, an exclusive interview with microsoft ceo satya nadella. microsoft celebrating its 50th anniversary. but of course, all of this news, the backdrop and one of the great american exports in the world. so squawk on the street begins right now. have a great weekend, everybody. >> good friday morning. welcome to squawk on the street i'm carl quintanilla with jim cramer at post nine of the new york stock

exchange. david faber has the morning off. that stronger than expected jobs number not doing much to alleviate more selling. s&p futures down about 2.5%. nasdaq 100 futures have been in a bear market this morning. ten year gets to 3.9. oil hits 61 and change on this growth shock. we'll talk to the labor secretary in a little bit about the jobs number coming up. let's begin though with china retaliating slapping this 34% levy on us goods. jim. and raising questions as to whether or not we're now in a tit for tat environment. >> well, i think we are in a tit for tat environment. i think that when you look at what they are going to bang us first, it's going to be ag. we won't feel that much in the present. congress will give them checks because that's what we do as a country, and we've done since 1933. i do think away from that. there will be technology already. they're starting some investigations that are bad. >> and dupont's. >> in. >> the firing line today. >> dupont, my charitable trust owns and this is an instance where i think that our country is destroying dupont, or at least a big part of it. it's 18%

of it, and there's no reason for it whatsoever. we didn't have to do this, but we can go further, deep into how poorly we've handled this situation, and i'm happy to do that. i think that it's a very disappointing for us who favor fair trade and tariffs. we're still struggling with what exactly they were doing for a position that i've long since held. that could have been great. the botching of it is quite extraordinary. >> your social media posts this morning do suggest that you are worried about execution. you you tweeted a picture of a of a dumpster fire this morning. >> i thought that was right. inappropriate. okay, so on wednesday, october 14th, i don't know if i have to mention the year dow was down 3.8% on thursday, october 15th. the dow was 2.48248. on friday, october 16th, the dow fell 4.6%. on monday, the dow fell 22.6%. that's where we are. unless the president changes changes course, that's that's called a black monday. it's called a 1987. i think that that's a very

good analogy. the other ones would be april 2000 and then maybe march of 2020. those are the good ones. the good ones are april 20th. i was hoping for a good one, but the best i can come up with is april 2020, where there was a march 2020 where we had we. that was of course one of the worst declines. but then the april 2000 and the big switch out of tech and into bristol-myers, coca-cola. that works too. not initially, but that one works. >> are you suggesting because this will get written up? >> i don't. >> care that we are approaching the risk of a true market crash. we don't use that word on. >> this saying that if you bottom fish thursday and if you bottom fish friday in 1987, you slept with the fishes on monday. >> you did suggest this morning that maybe the selling in apple's a good example was getting a little too aggressive. >> well, i mean look we a lot of people are in disbelief and don't think that peter navarro, for instance, who's a very fine man or a besson wouldn't go in,

maybe london wouldn't go to the president and say, look, we don't really want to crash. you don't want to be as hard lined. maybe you do the tiktok deal, maybe you say, look, but here's a way to cure things, which was the way that that nvidia did with taiwan. but but they could have a crash. i don't see why not. i mean, why would you buy stocks? what is the what? i mean now look true if you waited one year, if you waited till october of 1988, almost every stock that you sold at 87, you were up one if you had held it. but now in 2007, it took you five years. so it was a longer case. now against that, i mean, we have some good things. the ten year, the 3.9. yes. oil's at 60. >> yes. >> you have a chance to we have good employment. >> yes. although we're going to get to the jobs number. >> those are what makes it feel like that. it could be just 20 2020. it could be just 2000. 2000 was a tech bubble. now we do have real tech. i is real and

that could be delayed by this. but i think that they have to be a little more thoughtful about what's going on that they don't seem. i know that, for instance, the treasury secretary, he's been in 35 years. so what he was when he get in, i mean, he's not as old as i am. he might have missed some things. >> in terms of world experience. >> yeah. i mean, you need maybe you need 45. he seems like a fine man. i do think that what's happened, carl, is that i struggle for why? for what the president's game plan is because if you wanted to make the market crash, i think you would go with this game plan. i don't like that game. i do not favor that. that's the they know nothing game plan. and it's very disappointing because i'm a savvy person, business person surrounded by business people. it should not be in our country's interest to have the market crash. now, if i am blamed for what i said, you know what? i don't play for dinner. i

am finally at the darn age where i am allowed to say that if i mean it now. i said it a couple other times and i was right. in every occasion. i was in cash for 1987, in cash. that was not stupid. i was in cash for the crash. i obviously said in 2007 that the they knew nothing. that was good call. i don't want this to be that call. there's plenty of opportunity for the president to say, you know, i've been thinking, you know, we'll do the tiktok deal, we'll avoid this. here's the cure pit. peter navarro, will you give him a cure path? i mean, what are you doing? you're in the peace corps, for heaven's sake, tufts, you were like a regular guy. but then you have to be careful, because i can't think of a single reason in the world to buy a stock. now i'm on hold. i'm not going to. i mean, we've sold enough stuff for my charitable trust, but i can't bottom fish. i don't want to sleep with the fishes. >> right now. yesterday we you you did. we were talking about a 16 multiple on 26 earnings that might get you just shy of five

k. are you now more bearish than that? >> i think that i find it impossible to believe that the president would actually order a crash. no, jim, i'm not ordering a crash. yes, you are, mr. president, i am not. i mean, you want to do that. i mean, i don't want that. we have a lot of people who have money in the stock market. it's the bedrock of a lot of 401 k and ira. and i think that that should play a role too. and i am much more of a hardline tariff person than the president. >> we know this. you said the other day, i hate free trade. >> i hate free trade. i am so much harder line than navarro and trump. i don't understand how they could be so bad on fair trade, not help the working person. i don't get. are they doing this to bring back the sock industry? >> we're going to get more into the tariffs. jim. let's talk some jobs though. stronger than expected jobs number for march. unemployment does tick up a 10th to 4.2. let's bring in the newly appointed u.s. labor secretary, lori chavez-deremer, to talk

through some of this morning's numbers. madam secretary, it's great to have you. thanks for the time. >> thank you for having me. >> it's a great day. >> in america. >> we're definitely watching government, employment, federal, local, state. there's a sense that this might be still a doge free print. do you agree? >> well. >> i can tell you where the focus was is. >> the efficiency and the streamlining. where we did. >> see some government. >> growth was in local. >> government. as maybe many know, i was a. >> former mayor, so. >> the closest. >> to the people is. >> where that growth. >> happened in government. >> so we're seeing the efficiency. happening here at. >> the federal. >> level and starting to streamline with the private sector. >> madam secretary, i think this is a snapshot in time, and it's a good one. and i'm actually quite gratified because it could insulate us from what would happen. but do you think the stock market should play any role in the thought of anyone in the administration, or is it just an abstraction?

>> well. >> i can tell you this. >> this is. >> we blew it out of the. >> water, the expectations. >> you know, 140,000. >> we're seeing. 223,000 jobs to. >> uplift the american. >> men and women of. >> this country. >> that has been the focus of the president. certainly, when we're talking about. >> the. >> market, it is a snapshot in time. >> and what i expect. >> that this is not going to continue. >> to be stable. we're going to see. >> growth for the american workers, and that. >> is going to. >> affect the market in a. positive way. >> well, madam secretary, where exactly would the growth come if we are deciding that perhaps the smoot-hawley tariffs under hoover are too low? >> well, we're. >> seeing investments by many other businesses. >> we're seeing tens. >> of. >> billions. >> hundreds of billions of dollars. >> being invested in this country that is going to. boost the american worker. what we have. >> seen. >> from the. >> past. >> administration over the last. >> four. >> years has hurt the american

worker. >> i can tell you this. >> president trump. >> nominated me. i have. >> been. >> confirmed, and i will. >> be on the. >> road every single day. >> to talk to those american workers. >> because that's what we want to see. the president. cares about this workforce more than any. >> other president. he is the president of the american worker. i am aligned with him, and we. >> are. >> going to. >> make those. >> positive gains every single month. so that snapshot. >> in time. >> is going to. >> continue to be. >> positive every single month. >> so you don't see a negative jobs print, say, this year. >> well. i can tell. >> you. >> this right now, what. >> we're seeing was positive. >> it was we blew it out. >> of the water. >> even all the. >> economists that looked at this. >> thought we were going to have. >> a depressed jobs report and we didn't. >> so that's. >> a testament to the president, the economic. output that he is doing. look at the rose garden that we had the other day. >> who was in the audience. >> it was. >> all the american workers. we had our teamsters there. we had our united auto workers there. we're seeing those investments pay off, and i. would expect that to continue. >> we did have some negative revisions, of course, over the last couple of months. we also had these layoff numbers from

challenger yesterday, up 200% year on year, the highest since may of 2020. would you expect that to get reflected in the coming months? >> well, i. >> would imagine when we do these revisions oftentimes that. we if there's revisions to be made, we should do them immediately. >> what we shouldn't. >> do is. >> something like the biden administration, who held those revisions. >> and hundreds. >> of. >> thousands of jobs were lost. we're going to be focused on manufacturing. we're going to be focused on building in america. we're going to repatriate a lot of these companies back to the united states. i couldn't be more excited to get on the ground. you know, we're going to start off this weekend in pennsylvania on, you know, the american worker. i'm going to meet them where they are. i want to see what the american worker is up to. and we're going to. >> continue to influence. >> them so that we build right here in america. and this economy is going to grow stronger and stronger every single day. >> all right, madam secretary, can we just stop talking about president biden? he was the old president. we don't need to mention him. it doesn't really pay us. it doesn't get us anywhere. >> yeah. >> let's talk about. >> the new president. >> he's doing a. >> great job. >> that's what i'm saying. i'm

going to agree with you. i also want to talk about the working person. i'm very concerned that the working person is the one who's going to be squeezed, because the time between when you build a factory and we have workers and now is a big gap. so is there a course of action to make it? so like when nvidia said to the president, look, we'll make chips in taiwan semi. now if you give us a path, how about a path so that we can avoid what i think is the needless destruction of people's 401 k and ira, which does matter. what is the path of a company to go to the president and say, look, you know what? we're moving right now. can that company be exempted from these kinds of tariffs? >> you know, as i move through. >> this. >> process and i work with a lot of the other secretaries, secretary of commerce, secretary of energy. >> deregulation has been top. >> of mind when we have these conversations on the ground. i do want to be really. >> when. >> i think about it, manufacturing in a box. i want a landing team in some of these communities, when these businesses are, you know, being constructed and built and that we have the job force that are skilled. >> up.

>> skilled reskilled and ready to go on the ground. that's one of the things, again, as a former mayor, oftentimes i heard from businesses who said we don't have the workforce. my job here at the department of labor is to make sure that we're focused, and that we're making sure that our workers in america are skilled to do these jobs on the spot, and we can get ready to go. that is what the president wants. that's what i'm here to do. and i will advise him and assist him every single day on this issue and come. back from that road. trip and advise him. and i think he's going to do great. i mean, we are going to help these companies get to work today because i hear what you're saying, we cannot wait one year, two years. we have to get started today. >> the other thing that gets talked a lot about on our air, i mean, i'm sure you would agree, the country, our country is so innovative. but what happens when that reshoring process collides with the innovation of automation and robotics? and how many bodies do you actually need in a modern day factory that's based in the us? >> well, the. >> conversation that you're hearing on the hill, the conversation here in washington, d.c, is the same conversation i want to go out and make sure

that that's what they want on the ground. we hear about ai, we hear about, you know, automation. but the american workforce. >> that's what's important. >> and we want to protect the american workers. you know, the mission of the department. >> of. >> labor is to protect the american worker. and that's first and foremost, when i talk to the president, the president and i are aligned. >> that. >> he is the president for the american worker. i'll remind him of that every day. we are a great team together, and we're going to go out and get the job done. >> madam secretary, can we just put an end to nippon steel buying us steel? you know, they dumped steel. you know, they wrecked our steel industry. they, along with china, have done everything they can to record steel. is that what we should give is that we should let them have the property that is us. steel. let's speak up for the worker right now. >> that's right. >> we are. >> going. >> to speak up for the american worker. and so is the president. you know, i have been on the ground. right here in washington. steel, a former congresswoman. and as a mayor, i can tell you this. the president is in line with all of the american workers. we are not going to forget that it.

>> is a. >> change from the status quo. it's a change from the previous administration, and we're going to stay focused on that. you know, i understand that we want to build our auto industry here. >> let's not. >> let the audience at the rose garden. >> that was. >> the united auto workers. >> let's not let the people who lost their jobs be in vain because of what nippon steel and the japanese steel companies did. don't let it be in vain. we're. >> well. >> i. >> appreciate it. it won't be in vain. we're going to work hard every single day. the department of labor is here to stay, and we're going to protect those american workers. >> madam secretary, thanks so much, secretary chavez-deremer appreciate it. on the heels of that jobs number this morning, jim, we should we should note that we are about 2% off the lows. vix has come off of 39. >> because i think they're not going to let what i described happen. i think that they recognize they're going to give people a path. they know in the next 48 hours they have a choice. they can say look here's the path. and then, you know, we'll exempt you from the country. it's, you know, like, look, nike, okay, they're really

in trouble. but they went and played by the rules. they went to vietnam. yeah. i think you offer these companies a path and say, listen, we're going to exempt you. it just you can undo what you did in the next 48 hours. it makes no sense to hurt american companies. give them a path. >> but you're. >> talking. >> about maybe go up. >> you're talking about negotiating with an with a corporate, not a country. yes. right. because there's no guarantee these countries have an interest. >> nike did nothing wrong. lulu did nothing wrong. these companies, they didn't do anything wrong. they. they played by the rules. they left china, rh left china. they played by the rules. why hurt the people who play by the rules? hey, by the way, there are workers who work for those companies too. and it's not just steel mills. it's not just hosiery. >> well, there's a fox has a report today that governor newsom may announce plans today to try to exempt california products from some of these retaliatory tariffs around the world. >> he ought to get rid of that $0.20 on the gasoline. the american worker is going to have

to play in california because of the summer rules. >> well, with. >> oil at 6180 today, are you worried about gas tax? >> i don't know. i mean no i. >> let, let let them drink peanut. >> we'll take a quick break here. we're going to watch futures and see whether we get any improvement as we get closer and closer to the bell. as we mentioned earlier, s&p now down year on year. there was discussion this morning of whether dow would flirt with 40 whether dow would flirt with 40 k. we're back in a moment. i can't believe you corporate types are still at it. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars. (clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah.

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protection strategy customers today for tomorrow. >> america has to be able to protect itself. we need to stop supporting the rest of the world and start supporting american workers. >> the structural issues of re trade are not going to be easy. never been a fan of globalism. >> let me make this very clear. this is not a negotiation. this is not that. this is a national emergency. >> when we're in this fog of war about tariffs, that's a very dang fast and reliable solutions from comcast business can help turn your business into a... reliably up-and-running cybersecuring... performance boosting... storm preparing... ...wifi backup is working... ...reliably-connected, modern business. powering the engine of modern business. comcast business

i'm a model. >> take a look at some s&p laggards. we mentioned dupont, which is clearly going to be some initial collateral damage as china issues retaliatory measures. ralph lauren, estee lauder, the retailers and luxury continue to get hit. we'll get cramer's mad dash count down to cramer's mad dash count down to the opening bell on an at morgan stanley, old school hard work meets bold new thinking.

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in uncertain times, it's. >> tempting to retreat or. simply wait and see. >> at cme. >> group, we empower those who act. we deliver tools to help manage risk and. >> capture opportunities. >> in every. >> market. >> across every major asset class, to seize each possibility at precisely the right moment. >> cme group. >> opportunity is everywhere. >> invest with an advantage. >> be prepared for any market with cnbc pro. >> from market. >> volatility to. >> breaking news. >> you'll have the strategy and tools you need to reach your goals. >> become a. smarter investor. >> go to. cnbc.com cnbc pro now. >> let's get cramer's mad dash count down to the bell. >> we do need that path to help companies. and that should happen this weekend. it wouldn't violate anything the president said. one of the reasons i say that is because let's say you try to go to safety. so you pick a kraft heinz. got a really nice

yield this morning. city comes out and says, sell it. it's a share loser. it is in trouble on many different margin issues and it can't find a way. and then i would throw in glp's ones because it's not exactly like they've got this incredible lineup of things that are good for you. so this is the dilemma of the market. can you pull out of a terrific company like an arm holdings or amd and go into this recognizing you're going in sacrificing all your growth possible yield, getting cut cut you because of the dividend. and i say no, stay the course. right. because i believe that the president will see the light and say it's the countries that are problem, not our great american companies. we're not going to hurt those companies because that hurts the worker. it is such a clear path that i'm offering right now that if they don't take it, it's foolish. >> doesn't the country want the revenue? doesn't he want the revenue? >> well, you still get plenty of revenue if you if you just give companies a chance to be able to open jobs here. but they have to make an nvidia like commitment, they have to say, listen, we're

not waiting. we're not building the factory. we're putting people right. we have found space. we have found work because they have to do that in order to be able to say, look, there's going to be immediate revenue in our country. if they don't do that, then i understand they won't be able to raise enough revenue. but if you have to go after the countries that where people did the right thing, like vietnam and mexico, they did the right thing. they thought they were doing. >> the right thing. >> they did think that jim will get the opening bell in a couple of moments. don't forget, you can always watch us and catch us anytime, anywhere. just listen to and follow the squawk on the street opening bell podcast. >> america has. >> to be able. >> to protect itself. we need to stop supporting the rest of the world and start supporting american workers. >> let me make this very clear. >> let me make this very clear. this is not a negotiation.

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>> to. innovate and adapt for. >> what's just around the corner. because after 125 years of yesterday's, nuveen knows your ultimate stakeholder is tomorrow. nuveen invest, like the future is watching. >> the opening bell is brought to you by nuveen invest. >> like the future is watching. >> i think. >> it's going very well. it was an. >> operation. like when. >> a patient. >> gets operated. >> on and. it's a big thing. >> i said. >> this would exactly be the way it is. we have 6. >> or. >> $7. >> trillion coming. >> into our country. >> and we've. >> never seen anything. >> like it. >> the markets. >> are going to boom, the stock is going. >> to. >> boom. the country. >> is. >> going to boom. >> and the rest of the world wants. >> to see it. >> it's the president yesterday leaving for florida talking about these tariffs jim 6

trillion would be over ten years on this on this percentage. by the way russell three k market cap is down 8 trillion since the administration began. >> well look with all due respect to the president there's this this gap. and that's what i'm concerned about. it's the gap which you have a you have a jim farley trying to do the right thing, mary barton trying to do the right thing. but they just have this period where they can't build it here that quickly. and i think that they need help or they need a path. i don't want the $6 trillion to turn into 3 trillion. that would be wrong. and i want the cuts in the in the government to be able to raise more money. i'm concerned about companies and what they're trying to do for workers. and there needs to be a bridge. we're bridging the farmers, you know, the bridge, the farmers. but you have to offer a path to make it so that we still get those trillions, still get them. but companies that really want to help the american worker and commit right now, boots on the ground, shovel, shovel. that's what i need. >> a we don't know what trade policy will be like in 2028. b

you really want to start picking winners and losers. is that where we're going? >> well, i do want to make it so that you have a path and nvidia is a winner. they did the right thing. i was madam secretary of labor. she i would find her to be somewhat not really on point for my questions but there's got. hey, hey, i'm a diplomat, but you know, you really kind of want them to realize that in between the market booming, the president used to ask me about the stock market. i would say, mr. president, i think it could. boom. but i don't want to bust. >> right. that's a good way to put it. we'll see you. so this book develops. >> there's the opening bell and the cnbc. real time exchange with the big board. it's the ronald mcdonald. >> house. >> new york and partners, rbc capital markets and the new york rangers. they do such amazing work at the nasdaq. it is microsoft celebrating their 50th. and andrew's been with them all morning long. >> oh that's terrific. and steve ballmer is my classmate at harvard crimson. terrific guy.

satya obviously knows what he's doing. i'd love to ask him about whether he's really backing away from the data centers, or whether he's working with open ai, because i think you can't really stop the build out. one of the things that that you can't stop is the build out of ai, because it's too important for the future. we don't have enough workers. i mean, that's another factor. i mean, not thinking forward enough. peter, i really would like peter navarro to at least recognize that because i think peter's very much in charge. i think that peter should recognize the greatness of american companies. you can separate the countries. the countries have done nothing but dump on us. i don't want nippon steel because of what japan's done to us. i don't like what the koreans have done to us. i hate what the when the west german. look, we'll come in on monday and the europeans will retaliate. and you and i will be sitting here saying, oh my god, they've 34. that's what they'll do. they have to. >> well, and the degree to which they'll retaliate will come through our services and their digital services act. and that's where microsoft comes in, right? isn't that their card? >> exactly. that's their card. and we've got great digital

companies. and again, we have amazing companies. and i want to stick up for the workers of our companies because they're the ones who will indeed be sacrificed because the plans all have to be cut back. there's going to be this period where there's going to be a reframing of hiring, and they will have. we had great numbers today and the great numbers for the next three months, but after that, there's really no incentive to hire because you're not going to expand. small, medium sized business, i think can still do well. and i've been recommending people look at service companies. i think that those can do well domestically. i mean, i'm talking about like a cintas. you know, someone recommended today the burger king stock quick serve qsr and i you know i'm not it's not what i'm in favor of to go to those stocks. but that's what you have to do. but look at what the single minded retaliation that the chinese have done against american companies. well, those companies should be we can't protect american companies doing business in china, but we have to recognize that they are picking on american companies,

and we have to help our american companies. we do. we can't let them just walk all over our companies. >> yeah. i mean, there's no guarantee that this is it from china. >> no, i mean, take a look at what they were willing to do to doctor bourla and to pfizer. they were willing to not give them the vaccine. we get the vaccine for them. how how about gardasil and merck? they we have a vaccine for women. and they wouldn't give it to the people because they are not as responsive to their people as they should be. i think obviously they're very good at famine. >> and we haven't even gotten to playing cards like the yuan and any kind of fx adjustments. that'd be different. different ball game. >> they picked on. >> you mentioned supporting elements of our own economy. what do you make of this report that we're starting to move into the farm subsidy conversation, just like we were in 2018? >> oh, we have to write checks to them because that's the american way. do i think it's the way to do it? i mean, there are certain things i find that i'm not a farmer. i respect what

what happens if they lose that market. and i understand that they are a national treasure. at the same time, there are a lot of other companies that are national treasures too. i mean, there are ag and ag is sanctified from from president from the time of president jefferson. i get that, but i'm, you know, there's a there's a lot of companies, you know, there's 500 companies in the s&p 500. >> i've heard that i once heard there are thousands. >> of companies. >> i heard that too. but i don't. >> go there. >> because again, i am i am a kind man. >> yes. >> i'm a sweet man. but i just think that there we have to worry about some other companies to the ones that play by the rules. >> the one thing you're not mentioning, though. all right, let's game it out. they move production back. you start making stuff here. wedbush has a report out today that a domestically made iphone. dan ives thinks would cost $3,500. >> so you have to come up with a solution that says, okay, look, we're going to do something else. and i thought that apple did. i feel terrible what apple done. apple committed the most amount of money to jobs in the

country. they just did. and that should have then made it. so the president says to china, listen, we are doing what's right with apple and you should be doing what's right. stand up for them. stand up for them. but we can't be oblivious. you know, there are, you know, like we have this attitude which just says the companies don't exist, individual companies, but they do. and they're really powerful and big. and to be a great asset to america. >> by the way, apple market cap was 4 billion just a few months ago below three this morning. it's lost. it's lost to walmart in market. >> cap i know. but you know if you're the president you can say apple is going to be booming. they're going to boom. and you know i think they're going to boom too. i just say in the interim i don't want them to be hurt. now maybe the president thinks they have to be hurt. remember, he did say, you know, the forecast was basically pain. and secretary bassett, he's in the pain category. >> the clubber lang club. >> yeah. but you know i don't again i look at these things, i look at the possibility of something really bad happening monday. and i say, please avoid

that, mr. president. you don't want that on your watch. you really don't you really want to just say, you know what, we've got a path. and it's the way that taiwan semi has done it and we're really happy if people commit. they've got to commit now though. and they get and then they we're going to protect. >> them because. >> there's no reason to cause a crash. does it. bad thing to do. >> what does it mean that i mean watching lennar today. why can't these homebuilders get a run out of this new era of rates? >> because the what we're hearing and i like their push. i was doing some some of the work today says that the tariffs will add $6,500 per house. but because the mortgage rates go down you could help. so you could come out if you're the president and say, look, one of the great things that we're doing because we're so good at tariffing the government, the bond market is rallying. and that's because of everything i do, because i'm really good. and the bonds figured it out. and therefore you can go buy homes. that is a great speech. i'm better than you are. and

mortgages are coming down. i've never been able to give that speech. >> yeah. does it surprise you, though, that the dollar action, the way global stock markets were up around the world yesterday in some areas, and we. >> weren't. >> countries around the world are there thinking, you know what? we're we're pretty good government. a lot of things are happening. we're expanding our our our our economies. the united states is shrinking its economy. so it's better to be in our markets. that's growth markets, europe's europe's in a growth path. and right now i know the president wants to say that we're on a growth rate, but we're not until the 6 to 8 billion or trillion or gazillion, i don't know what he's raising a gazillion. i mean, it's really easy to say that. i mean, i'm worried about the american worker now, and madam secretary wants to worry about the american worker under biden. he was president. it's done. right. i mean, you know, president roosevelt did not spend a lot of time talking about president hoover. you know, he just didn't write

president mckinley didn't talk about his predecessor. it's just not what you do. just move on. >> what do you make of some say they're disappointed in bitcoin's or crypto's ability to act as a safe haven in this week. >> yeah. gold is i mean, i had doctor mark bristow on last night from barrick. and gold's been fabulous. it's very hard. you know, gold only less than 1% is found each year. and it's really proven to be that store of value. i'm a huge gold believer and a huge gold buyer. i do buy the costco, get the 3% discount on the credit card, but gold is a great place to store a great store of value. and you can't make gold coins, which i can't put out a gold coin that has my face on it just don't work. >> the president put out a gold card yesterday with his face on it on the plane. i'm sure you saw that. the $5 million trump card. >> well i'm interested. it's interesting. i actually like it from american. american. i'd like to agnico eagle from you know, one of the more. >> yes.

>> more gold oriented companies. jim go eagles. >> got. >> you mentioned the financials are a big story. card issuers are a big story today amex down five five and a half. i wonder you have strong feelings about amex all the time. >> you know, it's your 150th anniversary coming into march. they're having an amazing time. but this again, is i mean, i guess you're supposed to say, hey, sorry, guys. i mean, see, i don't get american express. they have a lot of people work there. it's a really good company. it's an american treasure. i don't want their stock to go down, but i accept the fact that it will go down as part of this whole period. but i can't tell you to buy american express down 13, because i don't know what's going to happen monday. you know what? president doesn't take. >> the pain. >> you know what amex reminds me of? it reminds me of buffett. and you know what? that reminds me of sitting on 300 billion in t-bills. >> well. >> i mean, how how good does buffett look right now. >> do. >> you think? >> i mean, this was the time to not do anything, but i think

that he had the luxury of that our viewers don't have, which is our viewers are trying long term to invest in stock market to. yeah you can i've always been recommending berkshire. but what you do is i'm worried about people who have 401 s. it does matter for one s matter and iras matter and people try to save trying to save matters. pensions for those who are still alive, it matters. and i'm just trying to say, look, let's let's just give a bridge here, give some hope. constructive, not anger, you know, charts. great. be constructive. explain to america that we're not doing this. i go in and buy a pizza, okay? and i pay you, and then you don't buy something from me. are you there for bad? >> that's what. >> that's what the complaints were about this formula yesterday, jim. >> it's the. >> pizza imports. >> minus exports, i mean, and then you add a couple greek letters in there that cancel each other out. >> you know, peter, come on, man, it is. it's a shame

because, boy, do they have a chance right now. they can go in to a company i don't know, gap, which has fallen into the gap and say, the gap. you know what? you've done everything right. you did vietnam. and you know what? we are going to offer you a path. let's build factories along the border in texas. and then you have mr. dixon say, you know what? i'm breaking. i'm breaking ground. give me a give me land. in federal land, you've got federal land. i'm breaking ground. there. gee. that's so. >> yeah. i mean, i think the response might be, though. we've been wisconsin's been through this on things like foxconn. and just because you have shovels doesn't. >> mean you. >> have a groundbreaking doesn't mean anything. >> well, i think that that's spying. they're making very highly technical things and that costs a lot of money. but what i'm talking about things where, yes, you build a factory and you can actually make the stuff that gap does, and i'm just trying to make it so that i'm not trying to boost the stock of gap. okay? i don't want to do that. i'm just seeing that there are ways to be able to make it so great.

american companies that that did not make a mistake by moving to china. we got to get out of china because that was the whole thing under president trump. move out of china and you'll do great. so they did everything. they they did everything right. and we would normally in life think that's unfair. >> yesterday a great example was dollar general versus dollar tree. yes. where who have very different exposures to china and traded like it yesterday. >> dollar trade. >> i thought of you because you talked about the lucky and the luckless. >> yes. dollar. todd vasos got very lucky with dollar general. dollar tree is really struggling. no, i know that was a very that was interesting. that was interesting. and i, i know that that five below went five below. i mean that's like really below. so these companies that you have to go case by case, i, i think that when i look at what happened with dow today, there were a lot of companies, you know, people a lot of people said that dow is in trouble. >> you mean the company? >> yes. you used to call dow chemical. you can't anymore. but they're down two and the yield

is 9.5. and now i'm starting to worry about the yield. a lot of people were in that for 6 or 7 yield. that worries me. i'd love to speak to jim fitterling, but that's they're turning out to be luckless for this. >> versus well, i'll tell you what. last few weeks we've been quietly reassured by corporate bond spreads. that was that felt different today. >> did it not? >> yeah. well that's part of the problem. that's part of why you can't bottom fish yet. because i'm worried about the bonds i to go back to the housing again i'm actually pro pro housing because i was so afraid that mark carney would say, listen, lumber, we put a big tariff on it and we don't grow enough trees here. now, again, i don't want to disassemble. it's very easy to say, no, we do, but we don't. i'm stuck with the facts, and the facts just they don't fit the story. that we'd be fine if carney went against against this lumber. great piece by peggy noonan today about canada. really great required reading about reagan. you reminisce about reagan because he really had a lot of things that he did

right with our allies, and it would be good for president trump to look at reagan. he was like kind of dynamite. >> it's an interesting point, jim. i mean, everybody thinks about mr. gorbachev, tear down this wall where you were. you were using a carrot and a stick in a sense, or a stick with charm. absolutely. >> it's so great because it was constructive. >> so you are you are a bit concerned about us brand equity. >> yes, i am, i am, and i think there's still plenty of opportunity. i don't think you have to dig in your heels. i think that the treasury secretary knows this. i think that there's ample opportunity to do the right thing, but it's got to be done. i hate to be, too. it's got to be done next 48 hours. >> why is that? because on monday. >> because, you know, this is too much of the path of what we had in a couple of other times. you know, look, we do have this when you see the stocks that are up, the general mills hershey that that speaks to april of, of 2000 when tech blew up. and tech has got a good motif because of i, i just think this is the most

the most avoidable decline i've seen in my career. >> well, now you sound like the ft, which called it one of the greatest acts of economic self-harm in american history. >> it's been very strong here other than when they savaged core. >> we've every day. >> but yeah, that's a very strong view. i agree with the journal editorial today about i felt weird. i said, oh my god, i've really changed about what's going on with tariffs. and there are a lot of really good people that the president could listen to who really want him to do the right thing, and it would be terrific if he did, and the market would be up big on monday if he did this. that's why i'm you know, i'm saying, look, there are there's a decision tree that could go our way that would still bring in the trillions, the decision tree that could be terrific. and a lot of people would say, wow, he's really got it. he showed you what happens if you guys don't play ball. you saw it. but now he's offering you a path, give you a little carrot and that works. and i'm very you know, and then i would come in, i'd say, wow, thank god i didn't say get out now. >> can i read you what bill gross wrote yesterday? i don't

know if you saw investors should not try to catch a falling knife. trump can't back down anytime soon. he's too macho for that. >> well, anybody can back down at any time. i remember in the cuban missile crisis when the sky was black, it was black and i couldn't figure out, mommy, what is that? well, those are airplanes going down to florida because we're going to have to bomb cuba. and the russians blinked. anyone can change their mind. anyone? anyone. >> with that in mind, let's get a little bit more on this retaliatory action by china today and get to eunice yoon in beijing. hey, eunice. >> hey, carl. >> well, china hit. >> back hard today. >> it announced. >> an additional. >> tariff to match. >> president trump's reciprocal tariff. >> this is on. >> all american imports, and. >> it's going. >> to be 34%. >> so that means that the average tariff. >> now for an. american import. >> is around 50%. and this

tariff is going to go. >> into effect. >> on april 10th. >> now to. >> target farmers, which has been a. key base. >> for. >> president trump. >> china's suspended. >> imports of. >> five agricultural companies. >> so the. >> reason they gave is because these. companies ostensibly didn't meet certain health and safety inspections. >> so those. >> companies that. >> are targeted. >> export sorghum. >> chicken. >> as well as. chicken bone meal. >> china expanded its. >> export controls for. >> certain rare earth minerals. what's interesting here. >> is that. >> not only. >> are. >> these ones. >> that are used in electronics. but also for a lot of medical devices. such as mris. >> so these are that's going to go into place. >> it also. >> is targeting medical. gear ct tubes in an anti-dumping investigation. >> finally. >> beijing has placed. >> restrictions on 27. >> companies, mainly in the defense industry. those ones.

>> are largely symbolic. we've seen these. >> companies on. >> these blacklist, the. >> the unreliable entities list or an. >> export control. list before a. >> mainly because of their work by supporting taiwan. the of course the island. >> that china. >> claims as. >> its. >> own guys. >> eunice we talked about dupont. now in the midst of this anti alleged anti-monopoly probe. have they established any criteria of which american companies might be at risk? >> well, at this point. >> it's really. >> anyone's guess. >> and everybody is. >> on the. >> table at this point. >> i mean, i'm. >> really surprised at this level. >> of. >> escalation by the chinese, especially with the tariffs, because. >> in. >> the past two rounds, they. >> were seen as a relatively limited. >> this time it hits. >> all different imports. >> and i think. >> what's also interesting. >> is that for these. >> types of items, you know, it doesn't just depend on whether or not. chinese people like.

>> to buy. >> american products. it also depends on whether or not. >> chinese state companies are. >> going to. >> be told to stop buying those items or not. >> i mean, just in. >> the past. >> month from the previous tariffs, we saw a huge disruption in the number of and the types of items that were brought into here from the. >> u.s, the. >> the large cars. >> for example, those ones saw a double digit drop. let me. >> just take a. >> quick look down. nearly 70%. >> of. >> the purchases of crude oil lng also dropped more than 40%. so that. >> was just from. the last. >> round of tariffs. >> well, i've got to tell you, eunice, my travel trust owns dupont, a great american company. now, chairman about to step down. you know, look, i know this sounds soporific, but, you know, they did nothing wrong. it's a great american company. it's been more compliant than almost any company in the world for over 130 years. and it's kind of

shocking just putting the company up in that division is going to go up. but did it matter at all whether they were an honest, good company that no one has ever accused of doing anything when it comes to that division? there were groundwater division. i understand this, but that has nothing to do with this. this is a clean division. did it matter? >> well, i think that. >> the. >> chinese will see it differently. >> they you know, there's. >> always been a complaint by the. >> us. >> business community. >> that they. >> feel that there's not a. >> whole lot of transparency. >> when it. >> comes to these types of. >> investigations. >> but from the chinese perspective, they would say that they. follow the law and. >> that in this. >> case, an. >> american company has breached the law. >> well, it doesn't really make sense if the american companies aren't going to be protected by our country. and they can the chinese can savage american companies. would you think that a new american company would ever want to go and open a plant in china? >> right. and that i think. >> that is going to be the. balancing act that.

>> the chinese. >> will have. >> they're going to try. >> to i mean. you know, they might not want. >> to go after, say. >> apple, at least at this point. >> or. tesla or some of the big companies. >> that that could potentially. >> you know, that are have. >> employ a lot. >> of people. they don't want to scare away. foreign investment. but, you know, at this point, you know, at. >> the. >> end of the. >> day, if the chinese feel that they have to. >> do what. >> they have. >> to do in. >> order to try to. really show. >> that china is, is standing strong against american power. or american. >> pressure. >> then than anything is up for grabs. >> but, eunice, let's talk about the possibility the great intellectual property of our country relies on the what i would call the semiconductor capital equipment industry. and there i'm talking about lam research, applied materials. these companies have really cooperated with china. they've been terrific clients of china, so to speak. would they even go after the ones with the highest tech that allows them to make the best semis? >> i mean, i think that. >> those kind.

>> of companies. >> with high tech. >> are. >> going to. be down the list, right? >> so the chinese are. going to make. >> decisions that are. >> going to be. >> least. disruptive to their economy. >> and you saw. >> that in the previous. >> rounds of the tariffs. >> that it. >> was. >> you know, items that are easily replaceable. >> or. >> something that, you know, they. >> think it won't really be so disruptive. >> to the economy because obviously they're authorities here are. >> very. >> concerned about the economy. >> but at the end of. >> the day, i think that. >> what what. >> they're going to prioritize is. >> the survival. >> of the. >> communist party. >> to make sure that president xi jinping. >> looks good. >> in front of the population. so if it means, you know, disrupting big american companies that bring jobs here that have brought big technology, you know, at the end of the day, that's not really. >> the priority. >> for the chinese communist party. >> we do have a statement from dupont. i'll read it. we are aware of a report that the state administration for market regulation of the people's republic of china has initiated an investigation. we take this matter very seriously. and

reviewing the claims in the report. eunice. thank you. eunice yoon will be talking to you a lot. i imagine, as long as you can stay awake in beijing. thank you. by the way, worse to down names at the moment. jim, boeing and cat. >> speaking of china, i know i mean, because of china, although caterpillar has diversified away from china so much and boeing has got so many orders, it shouldn't be. those are both mistakes. shouldn't do it. >> don't sell those. >> there are two down names, jim, that are green. and we were mentioning housing its depot and sherwin-williams. >> and i was just talking to chip in my ear just saying i want to talk about home depot. it's i think it's exactly the kind of stock you have to buy because rates are coming be houg turnover and it's a win for them. it's a good it's a very good situation. lowe's is up. >> too and it's a it works whether you are a new homeowner or you just keep your old place. exactly. the goodyear. >> trade. >> it does because the rehab is very important. remodel is very important. now obviously there is stanley works is being crushed here because they they import. but home depot can say

okay look guys, we're real big. you're not. here's your price. and that's one of the great things about ted dekker right? >> rh since inauguration day down 70%. yeah 135 today. >> you're going to talk to rh tonight. >> you do. >> have a lot of people are very worried about their balance sheet, which was referenced several times in the conference call. and we got to get to the bottom of that. gary's put back a lot of stock and the company's put back a lot of stock. and they have terrific a terrific product line for wealthy people. but obviously people are concerned about the buyback. i got concerned about nucor bought back a lot of stock high. i mean buybacks if not done with precision can really make it so that you don't have enough cash. but nucor is a great company. so is rh. so let's speak to gary. gary's you know i look at williams-sonoma that's getting killed. and laura albert's good patrice louvet does a fantastic job ralph lauren that's getting killed pvh had a great quarter that i you know don't even have to mention how that's

ridiculous. but and i do think that, by the way, just to clarify on dupont, they did nothing wrong. i mean, that's just what you do. i mean, did doctor bourla do anything wrong with the with his covid vaccine, gardasil vaccine and, and rob johnson and you know, when you take a look at a company like a merck, okay, they're doing everything right. and the chinese just said, you know what? we rob davis, i'm sorry that people didn't care. people didn't care. rob davis did such a good job and the government didn't care. they were willing to hurt themselves. and i think that that's unfortunate. well, they hurt their own people. and rob davis knows that. >> right. >> jim, a week from today, we're going to start getting q1 earnings. jp morgan today, given the multiple downside risks, we will inevitably see earnings guidance cut in the next season, adding another layer of selling pressure to stocks. i guess my question is who's going to want to miss? and if our guide lower and if they think they're going to guide lower, do they need to couple it with an efficiency push or a layoff push.

>> they'll do that and they'll say, look, you know, and they will and everyone will know. it'll be a fed cut, which isn't necessarily great for the earnings, but it does make you feel that the unemployment won't spike. those i see again, that's a group of stocks that i can't say buy it because i think they have to warn. and they're such great companies i feel better. the american express just literally in february was doing so well. and, you know, these are all things that were done. and the president very easily can say, listen, this is the pain i told you to be pain. and i'm saying, i totally get that. but you got to give companies a path. and all the financials going down is not a good thing. and there are because i respect our viewers. 401 k and ira and i don't want them to be hurt for no reason because that's their bedrock. and we don't want them to stop saving because a day like today and yesterday and monday are days was just, you know, it's not worth saving. and that. >> is saving. >> you mean putting money into the market? >> i mean, the stock market is the greatest wealth creator of

all time. but when you take it down the way it's been insensitively handled instead of sensitively handled, then you're going to make people not do the right thing by their families. the american working person needs to be protected by the government, not trash by the government. >> the other thing, since you're talking about changing generational sentiment, somebody suggested this morning that maybe by, say, the next presidential election, you have inculcated a new generation of free trading, a free traders, people who love free trade? >> well. >> free trade is the was the daniel moment, the american worker. and i'm so, so unhappy because i have a very hard line on on this. >> i know and it goes back to your. >> childhood and it just does, you know, my everybody my father worked for, and i just can't believe that they betrayed even my father with the way they do this, that it's not going to bring back what they think. those companies couldn't come back because they were handicapped and needed help. and i just think about my pop and i just say, god, guys, come on, let's be a little more. let's be let's be smarter. let's, let's

use real math. let's dignify the process and think about the working person in a real way, not punishment. i look, i at one point in my career, i was very much geared toward punishment, and i was wrong. it's not the way you lead your life. it shouldn't the president shouldn't lead. >> you're going to expand on this tonight, i imagine. >> yeah. i mean, you know, there's no need for punishment. these people, you know, these candidates, we're not at war with canada. we fought beside canada in d-day. let's remember who our friends were. they are not our enemies now. they didn't do anything. >> it's going to be an important show tonight. thank you. jim, as. >> i feel bad for the worker. they got betrayed. >> watching this open here. obviously s&p down not quite 3%. let's get to rick santelli this morning. hey rick. >> hi carl. indeed. well we had a march jobs report and it was a solid report. but unfortunately a solid report probably gets lost in the shuffle. a weaker report would have placed labor on a weaker footing. that would

have had more of a lasting effect considering recent circumstances. let's look at a week today to twos and tens together as we sit. right now, a two year is down about 34 basis points on the week. a ten year is down about 31 basis points on the week. these are huge numbers. when was the last time we saw yields like this? well, if you open the chart up for a two year, it's the 27th of september on a closing basis for the ten year, the 3rd of october on a closing basis. now there are some good news. the dollar index actually is moving higher today. look at a two day. and do remember that the advertisement by the conventional wisdom brigade was that the dollar would soar when all of this occurred with tariffs. it was exactly the opposite effect. as a matter of fact, on the week, even with the bounce, we're down about 1.8% on the week. there were years when we were down 1.8% on the dollar index. and finally, when was the last time the dollar was here? open the chart up. the last time the dollar closed at these levels

was about the 3rd of october. what a coincidence. the same day that ten year yields were down. so things are lining up. we see that many of the relationships between the dollar, interest rates and the differentials seem rather healthy. we want to pay very close attention to how the euro currency and the yen close, considering they're the two biggest contributors to the valuation of the dollar index. sarah, back to you. >> there you go. >> good friday morning, everyone. welcome to squawk on the street i'm sara eisen with carl quintanilla live from post nine of the new york stock exchange. david has the morning off. we've got another major selloff on wall street today. day two reaction to the tariffs china hitting back with tariffs of its own 34% s&p 500 is down almost 3%. so not quite as bad as yesterday but still pretty ugly. every sector is lower. the sectors taking it the hardest. right now you've got energy down 5.6%, financials down 4%,

industrials down 3.65%. the nasdaq is down 2.8%. i mean it is shaping up to be a pretty tough week. as we close out the week. we're looking at declines of 6% on the s&p, more than 7% for the nasdaq. as the markets digest this global trade shock after liberation day. >> about 30 minutes into the trading session. here. some big movers we're watching in this market sell off big tech. of course we're watching closely tanking it again. all mag seven names are getting crushed in the session. apple coming off the worst day since 2020. we'll get more on the tech trade in a minute. retail names again underperforming nike is now down 30% so far this year. and as we said, we're a week away financials on the show. >> let's bring in our senior markets commentator mike santoli as we continue to watch the sell off. the angle i'm going to take today is some silver linings. i think there's been a lot of doom

and gloom. we know there's a trade shock. we know it was worst case scenario. we know we're going to have to readjust the economic outlook. having said that, there are some pieces of good news today. let's start with jobs. i mean, it's not a normal reaction to a very good jobs report, but that's because you could look at it as a stale report. but it's new information. and the information is that the tariff anticipation was not weighing on the labor market heading into the month of march. the overall headline number comes in better than expected. the wage increase cooled down a little bit, which is good news if you are worried about inflation, for instance, we're still creating a lot of jobs. and if you look at where the jobs were, i mean, it was pretty broad. health care services continues to be a big job grower social assistance, retail trade, transportation, warehousing. you know, federal workforce lost 4000. but i don't know, with all the hand-wringing over doge, that wasn't too bad. local governments managed to add 23,000. so it just the

unemployment rate did tick up to 4.2%, which you may be worried about, but it did for the right reasons. it's because more than 200,000 people entered the labor force. also, that's pretty good news. and the overall number at 228,000 was a lot better than economists expected. now, is that going to hold up with all these tariffs? >> it just tells us the initial conditions of the labor market were pretty steady and pretty favorable heading into all this. yeah. >> all right. so i'll throw more at you. we. the president wanted lower oil prices, lower bond yields and a weaker dollar. and he's getting all of those big time. i mean, oil now is at the lowest since 2021. that's helpful for the economy. it's helpful at the gas pump. interest rates have fallen sharply. we're seeing the ten year yield now below 4%. we're at the lows of the year. and the us dollar as rick was just saying, it's significantly weaker. is it happening for the wrong reasons? yes. it's because there's a big markdown in growth anticipation for the us. but this will help cushion. >> yeah they're offset. >> what's coming. they are.

>> offset to some degree. >> yeah i mean they are like lower interest rates lower mortgage rates. right. lower lower borrowing costs, cheaper oil prices, weaker dollar will help our exports, even though we're going to have a lot of. >> trade barriers. you know, like if you need to get mortgage rates down like into the five and a half or whatever range where a lot of the existing mortgages are to really restart the housing market. i guess the question is, what do we have to sustain in terms of the economic outlook to get there? and so, yeah, i totally agree with what you're saying. and look, i said yesterday that ultimately we can also come back to this is mostly a domestic kind of focused, service oriented economy that's not make or break based on trade. i think that what the market's reacting to is this sort of belated overreaction type dynamic, which happens in markets, which is we were hoping that these firewalls would hold. we were hoping it would be a more moderate response, as opposed to the maximum tax on global trade. that's going to penalize the most efficient production across the globe. so i think that that's you know, obviously the market is now figuring out have we have we

started to quickly reprice to a negative enough scenario that we can build from there and clean out a lot of the complacent positioning that obviously was was in place. >> how can we say that when we haven't even started with q1 earnings or corporate commentary? >> look, the market tries to front run everything and the market tries to discount what's coming. and but i do think that's a challenge in terms of, you know, to the degree we can get some kind of short term tactical crescendo of selling, whether it was this morning or coming up. look, i think the thing that worries me most is what it means in terms of all the financial stress indicators that have flared this morning. so i mentioned. about 40. yeah the vix popping above 40 and then everything along that same chain moves right. credit default swaps high yield bond spreads. you see you know various volatility measures throughout the market. and you know all that really means is that people are in intense risk off mode. and they're willing to contemplate the negative tail scenarios. it doesn't mean it's

going to be self-fulfilling. >> right? i'm not done. i have more potential silver linings here. one big one is that the fed has a lot of room to cut. and it's important because the fed has been restrictive in its own words and very tight. and chair powell is going to be speaking this afternoon. we'll get his reaction to jobs his reaction to tariffs. there's a chart out there. if you look at what's happened with the two year yield, which is the market's best way of anticipating what the policy rate should be versus the actual policy rate, the fed funds in orange. thank you ben for this from fed watch. the market is pushing the fed to lower interest rates and expecting more interest rate cuts as a result of all of these tariffs. in other words, yes, the fed has a dual mandate, right. it can't deal. it has to fight high inflation and it has to fight weak economic growth. the market is telling you that the growth side of it is going to be more important, and the fed is too restrictive than the inflation out. the fed is going to be cautious because it doesn't want to make the same mistake that it

made last time around, thinking that inflation was transitory and being late. however, there's room to cut. and i don't think if fed chair powell continues in his stance of we're not in a hurry, i don't think that's going to be good enough today. i think he needs to talk a little bit about the downside risks of the economy, which would signal that they they will cut if they need to. it's not going to offset a trade war. two things it will help. >> for a long time you were critical of all cuts. you didn't like the 50 and now you're in cutting mode. the other is that you also argue that tariffs are something the fed shouldn't really have to look through. and now are they going to be responding to a tariff driven, supply driven demand story. >> no. i think they should look through tariffs on the inflation side and worry more about growth, which is what i've always argued. and now the growth outlook has deteriorated substantially. so it is time for them to start thinking about cutting. they do have to totally consistent. they have to make sure that inflation is not a big problem and that, you know, that's an uncertainty because tariffs raise prices. i do. >> think. >> however, if you look at what the market's telling you,

inflation expectations go out five years. oh yeah they're not i know. >> but the one year break even is what it's telling you. it's going to be a short term short term. >> issue but not a long term issue. >> yeah i agree with that to be honest. i mean look we hiked when inflation was short of target, you know back in 2015. like it's not as if it's some kind of a circuit breaker. on the potential for i think the, the bad scenario for, for the market is if the fed is going to be backed into that position of waiting for like the financial plumbing to clog up, and all of a sudden it's about a systemic thing that happens which gives them cover to act regardless of what the inflation outlook is. and nobody wants that. i'm not saying it's happening, but i think they're going to be slow in saying downside risk to growth are such that we're going to front run the data and cut. >> yeah, the problem is they might be too late. then when they do. when they do. >> that's the two year note. >> that's what it's telling you. you know, we have a great chart of the short term and longer term inflation expectations two year and five year. so you're right carl. two year. they're

getting nervous about inflation. and that would make sense after tariffs. but but long term five year five year swap. it's going down. and that suggests that there's less worry about persistent inflation. >> and they're going to be backed into a transitory framework. >> well no. or it means that over the five year. >> they're going to have to cut because growth is deteriorating. >> right over five years. there's going to be a recession is what the market is saying. and that's going to just completely pull inflation out of the system. >> i think that's that's the key. and so i am listening for that. and then there's the other thing, which is republicans aren't exactly on board with this. i mean, let's look to congress. i hesitate to say let's be optimistic looking to congress. but i think this is something that will make congress aware that it needs to be in the building. right. and while this is in the power of the executive branch right now, i did take note of a lot of comments from senate republicans that were anti what the president is doing. senator ted cruz, tariffs are a tax on consumers. i'm not a fan of

jacking up tariffs on american consumers. there it is senator rand paul on the hill i think it's just economically a fallacy to think it will help the country. tariffs are a tax. senator ron johnson double edged sword. senator mitch mcconnell i know he doesn't have a lot of love at the white house, but he's against it. what time americans are tightening their belts. we would do well to avoid the policies that heap on the pain. will congress actually make a move here to try to, at least if they can't limit the authority on tariffs for the president, at least get more involved where they would have to run it, run something by congress? there are bills out there that are being proposed that will maybe give them a little more say. >> we had maria cantwell on squawk. grassley and cantwell working together. question is whether the president is more apt to listen to them or to corporate leaders or both. we'll see who they're. >> complaining to. >> right. meantime, tech is getting trounced again. as you know, coming off the worst day since march of 2020. the pandemic, of course, the second worst sector this week after

energy. apple among the hardest hit, its market cap falling below 3 trillion this morning, which we mentioned with jim joining us with his perspective on apple in particular in the tech trade is maxim group's tom forte has a 215 target and a hold on apple. tom happy friday. good to see you. >> have me on. >> can you talk about their supply chain issues, how they've played this whole era politically, whether south of 200 is overdoing it or not? >> yeah. so i definitely think a 10% move give or take, in apple yesterday was an overreaction. so i think what we're we're saying tariffs. but what we really should be saying is trade negotiations. trade negotiations have begun on a global scale. and when you look at the multinational us based ceos, tim cook and elon musk are really the two best positioned to negotiate between the government of the us and the government of china. so yes, apple has an overweight too. many of their

products are made in china today. but i do think tim cook is wonderful and he'll figure out a way to address this. and apple's a premium brand, so maybe they can't fully offset the impact of the tariffs if they do happen by raising price, but they'll be less negatively impacted than others. so what do you think feels like an overreaction to me. >> right. where do you think where are you modeling asp average selling prices on on an eye on a new iphone. and yeah, so i think i mean, do you have an idea of what a fully domestic iphone would look like? >> i think you can assume that from a cost standpoint, it would be 10% more expensive. but again, i don't know that the end game or ultimate outcome here is a iphone made in the us. it could be more products that apple sells are made in the us, or it could be more products are made in india or in a different country where the potential end game tariff isn't as significant

as it looks today. >> i mean, why do you have faith that that tim cook would get some sort of exemption or relief? >> yeah. so it's not that i have faith that i'll get an exemption or relief, but i think there's the possibility. so if you were to just to have a short list of ceos who donald trump will take their call when they call him, you know, tim cook is clearly on that list. so i think, again, i think the market is only looking at the negatives here. i'm not saying it's a guarantee. i'm saying it's a possibility. and the market appears to be overlooking that. >> what about just the general economic outlook changing as we were just talking about being downgraded, more recession being priced in? i mean, ultimately, what does that what does that typically look like for apple? >> yeah. so what we found is that the iphone in particular almost behaves like a consumer staple and not like a consumer discretionary item. so if we can set aside, you know, the notion

of the ai upgrade cycle and things of that nature, generally speaking, apple's iphone, which is still its most significant product, the sales have held up well in recessionary periods. >> so you're a buyer on the weakness. what would what would make you change your mind? >> what would make me change my mind and get more cautious on apple is seeing that the trade war between china and the us further softens their sales in china. so if you recall, they had a 10% decline in the december quarter. so in a near term basis, you could see a lot more weakness in their sales to consumers in china. that's a high teen percent of the sales. that would make me more nervous about the stock over the next 12 months, right? >> yeah. we had a discussion, though, about their own employment, exposure to apple assembly, and they don't want to upset too many apple carts, so to speak. tom thank you. look

look forward to talking more tom forte this morning by the way quick programing note later today. do not miss our andrew ross sorkin live in redmond, washington with satya nadella of microsoft. that's coming up at 2:30 p.m. eastern time on power lunch. >> first real ceo reaction to tariffs. it's been very quiet on cnbc. unusually for ceos, as they try to process all of this and what they're going to do about it. so that will be really good. let's get to megan costello in washington tracking the president's movements this morning. megan, what can you tell us? >> hey, guys. so we've been waiting to see the president this morning. we know that he's been down in florida since yesterday afternoon. we've been waiting to see the president, and now we can report that he has just arrived at his golf club, the trump international golf club in west palm beach, florida. i think we have some video here to show you you'll be able to see him. that's him with his red hat on, waving while talking on a cell phone as they pull in to the golf club he was. he left yesterday afternoon. so less than 24 hours after announcing this sweeping tariff

plan, he left for florida, attended a closed door dinner last night for the liv golf tournament, and we don't expect to see him have any public events today, so that may be the only time we see him on camera today before he has a fundraising dinner for his super-pac tonight. so a split screen there with what we're seeing in the markets here and seeing the president down in florida, we did, of course hear some of his reaction this morning. i know you guys have been talking about this, saying china played it wrong. they panicked. that was his first direct response to the retaliation, also saying in reaction to the jobs report that it was far better than expected, shows his plan is already working, and says, of course, that his policies will never change. guys. >> yeah, certainly didn't do much for the opening bid as we're now at session lows. s&p down 200 points megan thank you megan costello. we're going to hear from the fed chair in the next hour. his first public remarks since the president unveiled that tariff plan. our steve liesman is here with more on what to watch out for. hey, steve. >> hey. would you forgive a

really bad musical pun here, carl? i'm going to say where have you gone? fed chair panel. the market turns its lonely eyes to you. and indeed they do. take a look at the expectations here in the fed funds market here 100% now in may that was down i don't know 3,040% before those tariffs came out thursday. now they're sure of a second cut in july. third cut september. that fifth cut was a bit higher over near 60% this morning before the jobs cut. but it didn't really diminish the idea of four. and if you were to look at the outlook, for example, for the february contract, we'd be down near 3.15%. can the fed come to the rescue? sarah was talking about it just a minute ago. what i'm hearing is they need to see substantial weakness to move. they cannot act preemptively because of the expectations out there of a one or even a 2% bump to the pce from the tariffs. the policy uncertainty is interesting in the sense that it

limits the flexibility of the fed. how do you cut rates right now? if the fed if the if the president can get rid of the tariffs with a tweet with the economy in good shape, now you know that jp morgan raised its recession to 60% from 40. they say this risk is magnified by a new drag as sentiment, business sentiment they need responded to the potential for a business unfriendly policy mix. it was a good jobs report. you guys know the numbers. 228. but whether or not that matters is unclear. in fact, one of the things i'm hearing, guys, is that the better these jobs numbers, the less the fed has, or less ammunition. the fed has to act in response to some of these recession calls that are out there. guys. >> i think the question will be how closely do they pay attention to the market, you know, and are they led by the market? because what we're seeing in fed funds futures, as you just noted, the may 100% cut, the two year yield. i mean, the tightening of financial conditions, all of that is pointing them to a cut and a cut

that would be in response to what we're getting out of the tariffs and not worrying so much about one off inflation shocks. >> so, sarah, i keep putting myself in the press conference right on a day that let's say there was a print a week or so earlier that the core pce went up to 3%, or 3.5%, and the fed cut. what does that look like? what is the message to market? what happens to the fed's credibility? he comes in. he says well these are transitory. and the entire press press corps, all of the market, they roll their eyes as far back in their head and they say, mr. chair, we've heard this before, this idea of transitory, it didn't work out so good the first time. the fed's really in a bind here. and what i'm hearing, sarah, is that they have to see substantial weakness in order and maybe for several months in a row before they can act. the tariff effect on inflation limits their ability

to act preemptively. >> no. yeah. they can't make the mistake again. >> and we have. >> to be cautious. >> we have to watch credit as well. as you guys were talking about, i don't think we're in that situation right now. we're not anywhere near some of the worst kind of concerns about consumer credit card credit default swaps or those issues, but they are up. they are higher. we are seeing some junk spreads widen out. these are worth watching. if there's a credit issue that changes the game for the fed. >> all right steve thank you. high anticipation for fed chair powell. the financials and asset managers getting crushed this week. our leslie picker tracking the action in that group. morning leslie. >> good morning sarah. this feeds into what steve was just talking about because in most pockets of their business, banks actually aren't directly impacted by the terrorists. but you have the kbw bank index having its biggest daily decline since the regional banking crisis two years ago. and that is because growth in the banking industry relies on a strong economy. and as recession fears worsen due to this trade war, investors are going to sell bank

stocks. today, you can see shares of the big six u.s. firms adding to yesterday's steep declines. however, the volatility could benefit firms with sizable trading businesses, particularly in the equity space, fx and commodities and bank earnings kick off one week from today. so we'll not only get color from the executives from these firms, but we'll also get a sense of how they're assigning the probability of a slowdown based on what they do with buybacks and how much they're reserving for soured loans. alternative asset managers have more direct exposure to tariffs through their portfolio companies, many of which are in industrials and energy and consumer and other places that are adversely impacted by these policies. and due to the leverage on these companies, the publicly traded firms tend to have a magnified response. and these headwinds make an already challenged environment for exits, sales, and ipos relatively untenable. carlyle, kkr, apollo each losing more than 20% in two days alone. now, to be sure, lower rates are helpful for deployment of their

capital because they make the cost of financing cheaper. and it's also worth noting that publicly traded alts generated huge gains in the stock market last year, so they are an easy target in this environment for crystallizing gains in a downturn. guys. >> we think about the private equity community, leslie, as i would argue, very robust backers of the president during the campaign. and when we talk about what elements might be pushing back on the oval, whether that's gop senators or corporate leaders, it's hard to imagine that these wouldn't be part of that conversation. >> oh, absolutely. >> using their influence there. you know, publicly, we've heard pretty much by and large across the financial services industry, broad based support. you know, it's obviously a spectrum. not everybody feels the same way. a lot of discussions about uncertainty without pushing back on specific policies. and a big reason for that is because they're expecting this big, overarching deregulatory agenda that they have been pushing for years. they say it will

dramatically improve their business, who they can lend to, how they lend, and so forth. and so that has been kind of priority number one for these businesses. however, i think the calculus has always been that, you know, tariffs have been in place, but they don't want to see tariffs really kind of put the economy in jeopardy. and so that, you know, weighing those two elements i think is top of mind for executives across the financial services space. >> leslie, i wanted to ask you about hedge funds. hedge fund performance so far this year because i can report according to a source, nelson peltz was up 7.5%. and that's pretty good performance in the first quarter. that was the worst quarter for stocks in years. and they don't have any shorts. yeah 100% net long. now they are very exposed to some of the staple stocks that held up better. and what they see as, you know, big improvement stories like a unilever or a wendy's. but what what can you tell us. that's got to be unusual to have such good performance in the first quarter.

>> especially for being net long in this environment. that's tremendous performance. counter that with bill ackman at pershing square, which was down about 7% year to date through march 31st. so kind of mirror images there. and he tends to be net long with some macro hedges in place. i'm not sure if he still has those on or not, but broadly speaking his equity exposure is not long. hedge fund performance has been really, really tricky in the first quarter of the year, and a lot of that has to do with just the overall volatility that we've been seeing, as well as some groupthink dynamics in terms of how a lot of hedge funds really piled into some of these so-called trump trades areas that were seen to benefit, whether it be the mag seven, whether it be financials, which tended to unwind, as we saw, all of this volatility. and so it created also some magnified effects there as the hedge funds were deleveraging carl. >> yeah. tech a big part of that. now nasdaq in a bear market this morning leslie. thank you leslie picker. meantime energy prices also

sinking. crude hits its lowest level today since april of 21. our pippa stevens has more on the implications of that morning pippa. >> good morning carl. well wti dropping to $60.81 at the low. tariffs and demand concerns are the overarching bearish backdrop here. but for oil specifically the surprise announcement from opec plus that they will raise output by 411,000 barrels per day come may. effectively three months worth of production increases is likely the biggest driver. now, the timing, of course, is notable, with the group officially pointing to strong market fundamentals. that is a view not shared by many market participants, at least for the time being. so there are a few reasons why the group could have done this. some nations, like iraq and kazakhstan have been continuous over producers, and so it could be a signal to them to get in line with their quotas. president trump has also repeatedly called for opec plus to raise output to bring prices down for americans, since lower oil could help offset some of the tariff inflationary pressures. finally, opec could

be vying for market share here. for a long time, they've been defending prices by withholding so much oil from the market. and perhaps this is now a strategy shift. so the bottom line, carl and sarah, is that this was already an oversupplied market. adding tariffs and surprise opec moves. and there is really nothing to like here. >> i mentioned earlier how this is this is potentially good news for the economy. if we get lower gas prices, lower oil prices, it's exactly what the president wanted. but but he also wanted to drill baby drill. and i wonder what happens to those capex budgets and production if we continue to see share price pressure here and lower prices? >> yeah. so lower oil that president trump has called for is very much at odds. you know, with the drill baby drill that he wants the producers to do. but you don't want to do that since they of course want those higher oil prices. there's no doubt that lower oil will help consumers. we have seen gas prices on the national average move up to the highest since september. and so that is starting to take a bite out of consumers wallets. but when it comes to the oil and gas

executives, you know, we did hear from them in that anonymous dallas fed energy survey recently. and with the mask of anonymity, we heard some pretty pointed comments with, you know, with companies saying that the administration's chaos is a disaster for the commodity markets. the only certainty is uncertainty. i've never felt more uncertainty about our business in my entire 40 plus year career. and so there is clearly a lot of chatter here going on behind the scenes with president trump calling, you know, for drill, baby drill when these companies don't necessarily want to do that. >> yeah. the dallas fed qualitative commentary was one of the best reads of the week. the other question i have, pippa, is about break even cost, because there's been discussion of what steel tariffs are doing to the price of 5.5in drill pipe, whether or not that that margin is getting squeezed with these lower prices even. >> yeah. so we've seen the inflationary pressures certainly rise the break even cost for a lot of these producers. maybe, you know the north of $50 per barrel range. and so when wti is

sitting here at 61 they're still in the okay range. and they'll certainly be able to cover all of their capex budgets as well as dividends and buybacks. but it does start to bite a little bit. as you said those steel the piping costs labor costs. you know, you have to have all these raw materials sand, all of those prices have gone up. and so that does then act, as you know, a further draw down on the profits. and then also it makes executives reluctant to start drilling, particularly if you're if they're unsure about what opec's policy is going to look like going forward. >> okay pippa. thank you. wti crude 6103. the lowest level we've seen in years one outperformer this week in the market. consumer staples in fact the best performing group on the week and the only sector holding on to gains week to date. key gainers in the group lam weston, hormel, dollar general names like kroger, philip morris, monster beverage. they're actually hitting new all time highs this week. carl. not necessarily on the fundamentals

of their industry, although they are less tariff exposed because even the food companies that have to import a lot of them do produce food locally where they serve their markets. but it's more just the shift and rotation in the market towards safer stocks. stocks that do better during recessions and economic downturns because you need to eat. i mean, when you have a tobacco stock, a philip morris as the best performing staple, stock up 30% this year. things are not all good with the with the global economy. >> i think it was bloomberg this morning said even in a recession, people are going to smoke and go to the bathroom. i guess that explains a lot of that, which kind of points to jim's point of this. that is a lot of this is a big giant rotation as opposed to a sell off. i was curious yesterday we talked with jim about the difference in trading intraday between dollar general and dollar tree, because ubs had some interesting numbers on the difference in their china exposure. it's pretty big. like one is 30% the other 8 to 8%. >> so i guess the markets picked up on that because that will drive their costs up. i mean not

and there's also some warnings. instead of buying all staples, you really have to know what you're getting. for instance estee lauder is underperforming today. it's getting shellacked. why? because it has huge china exposure and asia travel exposure. so that's that's a potential risk. also you know the beverage makers i would just caution here rfk jr. health and human services secretary has really ramped up attacks on big soda. and while he doesn't have outright authority to ban them from the snap program, the food stamps could pressure the states to do so. so watch that space, because soft drinks soda. the number one purchase in food stamps snap. so that could be a big headwind for the industry. it's and they're also exposed internationally. i mean more than half of coke's business is overseas. so they they get hurt by tariffs. but they do get helped by the weaker dollar. that's something. >> which we don't have much of today with the dxy up a little bit by the way. session lows again down to 5185. s&p is down 208 points. all sectors are red. some of the standouts are going

to be energy down 7%. materials down four and a half. financials down five. and a third. we're going to get of course those earnings beginning a week from today vix back to 38. not quite the highs of the morning but obviously close. china of course retaliating with tariffs of their own. once again let's get back to eunice yoon in beijing. hi again eunice. >> hey carl. well china hit back hard. the most sweeping of the countermeasures is the counter tariff. this is an additional 34% tariff on all american goods. which means that on average, the tariff for u.s. products is going to be around 50%. so that tariff is going to go into effect starting april 10th. to target agriculture, which is a key base of president trump, the chinese have suspended imports of five agricultural firms. the chinese allege that these american products failed a safety and health inspection. so the

companies targeted export sorghum, chicken and chicken bone meal. another company that's been accused of breaching chinese regulations is dupont. dupont, according to the market regulator, is now under investigation for allegedly violating the country's anti-monopoly law. the government here is also targeting exporters of certain medical devices of ct tubes, they said in an anti-dumping probe. china expanded its export controls as well for other rare earth metals, some of them that are very important for the use of medical equipment, such as mris. and then finally, the chinese government has added 27 companies onto their their blacklist, an unreliable entities list, as well as an export control list. most of them are in defense. it's largely symbolic, i would say, because these companies have been targeted before. for some of them, for the work that they

do with taiwan, which of course is an island that the chinese claim as their own guys. >> how hurt is china going to be from all of this? i mean, trade, trade, exports, that represents a much bigger part of their economy than it does the us. >> absolutely. i mean, they're going to and the effective or average tariff rate on china is north of 70%. if this goes into effect on the weekend, i mean, it's really, really big. there's a lot of concern about it, not only when you talk to exporters, but also you could tell from the way that the government is, has been signaling that they're really worried about the impact on the chinese economy. citi citigroup actually said that this could take 2.4% off of the gdp growth here in 2025. and the chinese government already has been taking steps to try to stabilize the economy. talking about shoring up and prioritizing consumption, for

example. that's something that that they've been wanting to do, in addition to diversifying their markets. >> finally, earlier in the week, eunice, some chinese state media had reported that a response would come jointly between china, japan and south korea. that hasn't happened as far as i've seen. >> no. and you know that that was actually coming from a social media account that is linked with cctv. that tends to it's anonymous, and it tends to message what the chinese government is thinking. and that's what happened during trump. trump's president trump's first term. but it looks as though it's mainly coming from the chinese side, that they hope that there could be some coordinated effort between and response between the chinese and japanese and the koreans. but since there is a lot of deep seated suspicion among all three countries, but mainly with the japanese and the koreans towards the chinese, i think at this point it's just wishful thinking. >> i mean, all those american

companies that sell to china are getting whacked. today i mentioned estee lauder. nike is down sharply again. disney is exposed. so many have looked to china and their consumer as part of the growth story. eunice, thank you very much for the update from beijing tonight. joining us on set to digest all of this at post nine is goldman sachs. chief economist jan hatzius raised his recession odds earlier this week. jan, where are we now? >> well, we said. >> 35% last weekend and. >> that seems low. >> it's up a lot. >> okay. >> we ended up with tariffs a little bit worse than what we had thought. we thought the average us tariff rate would rise by 15 percentage points this year with wednesday's numbers. if you just assume those they don't go up they don't go down. we'd be between 18 and 19 percentage points. so that's probably worth another few tenths. you know, maybe just under half a percentage point on on growth. if you just literally

push it through the model. and that would take you from 1% growth, which is what we put put out last weekend, q4 to q4, down to the sort of 0.6%. i mean, if you want to be very mechanical about it. so we're definitely moving in that direction. i think incrementally it's 35% and rising. we're on recession watch in the sense that, you know, this is a pretty high level. and we never got higher than this in our own forecast in the sort of 2022 to 2023 recession scare. so i think this is, you know, a very serious, very serious number. but we're not quite at the point yet where i would say that a recession is the base case. >> yeah. i mean, the predictit ads, if you look at some of those odds, they're above 50% on on recession. and i think it sounds rosy for you to say that there's still 65% chance that we don't go into recession. >> the predicted odds are

higher. the consensus forecast in 2022, 23 was was was also higher. and look, i think a lot of what we're seeing here, the economy is still a very solid economy. there are a lot of tailwinds. so this really all depends on policy. and there could be, you know, a shift in that. and then i think a lot of this would go away if we saw a, you know, a turn in this in this path. this path is weighing on growth. it's boosting inflation. and that's really what the what the bet is about i think. >> are you one gdp. and what about consumer spending. >> we are not. but it's not we're not we're not far from that. you know just just above zero certainly could be a negative number. and consumer spending big decline in january which didn't worry us too much because q4 was very strong. but then you didn't get that much of

a rebound in february. and what you're hearing about march is obviously pretty negative. so i think again, this is going to be fairly close to zero. and you know, we'll see. we'll see where where it prints. to me that's a little bit less important. i always have been much more in line with the national bureau of economic research definition of a recession, that it's really a sustained and kind of uniform downturn in economic activity, not just the mechanical gdp estimate, especially because those numbers can get revised. but that's also a negative data point. i mean, we're tracking at a very weak level. >> you also had a great report this week on foreign boycotts and sentiment turning against american brands. what might happen to tourism from our number one international visitor being canada. can you explain what you think that might do to growth? >> yeah. so we looked at a

number of things. boycotts of american brands in in retail. you know, obviously alcohol and consumer brands and things like that. most of those look like they're going to be relatively small. but travel is a different story. travel tourism into the us is 0.7% of gdp. it's about 2/10 for canada, about 2/10 for europe. and a lot of those bookings are down quite sharply. so i don't think this is nearly as important as the tariffs. but it could take off another couple of tenths. >> so carl reminded me today that i was very critical last year when the fed was cutting 50 basis points, when the outlook was very strong. now the outlook is completely changed and the outlook is very weak. and a lot of indicators, especially in the bond market, are telling you that the fed should be getting ready to cut. do you think they should in may? >> i think i wouldn't make that judgment right now. we're not forecasting a cut in may. we're forecasting three cuts. july.

september. november. i think june is very possible. i wouldn't rule out may. that's really going to depend on the on the data. the complication is that, yes, real activity looks like it's headed significantly weaker. but we are getting a positive price shock. >> the question is should they look through that because the economic shock is potentially worse than the persistence of the inflationary shock. >> i think the tie breaker. i think they're going to be two drivers of that one. how much does the labor market deteriorate if you get a significant increase in the unemployment rate? of course, they will cut if you have the five days before the next meeting is the next employment report, if that's very weak. and we have gotten sort of bad news in the meantime, then i think they probably will cut. the other one is what is happening with inflation expectations. this is something that they are concerned about as well. the surveys have shown some sizable

increases. some questions around the michigan survey in particular. i think there are some statistical issues that we've discussed on on this show in partizan, and also the shift from telephone survey to an online survey. other inflation expectations measures like breakevens in the bond market still look fine. so bottom line, if the unemployment rate goes up, i think we'll get cuts. >> finally, two last questions. corporate credit spreads your level of concern. and i think is costing penciling in 3% earnings growth for the year. and what do you make. >> of that. he has brought it brought it down on the back of the economic forecast changes. i you know i'd say on credit a lot. bqe our chief credit strategist, you know, does think that more widening is you know, he has been saying that that that widening is certainly a risk. and the you know, the equity market has taken this on board to a greater degree than

than the credit market, which is often the case in the early phases of a downturn. and so, so yeah, he's he's definitely taking a cautious view. >> and really quickly on what what do you expect to happen to prices for consumer items because of all this. these tariff announcements. >> oh i think i think they're going to go up. and that's i mean on on inflation core pce. when we made that forecast revision last week, we went to 3.5% for core pce. at the end of the year. again, an extra four percentage points or so on the average tariff rate might add another 4/10 to that. so you'd be close to four. >> all right john looking at session lows here for the nasdaq. and the s&p 500 which is down more than 4%. thank you. it's a good day to have you. jan hatzius on the jobs day from goldman sachs. >> we'll take a break as we watch stock sell off here. as sarah said close to session lows. by the way, the august lows would take you around 5119.

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an advantage so that you can craft your own investing strategies. >> become a cnbc pro. >> go to cnbc.com cnbc pro now. >> dow s&p on pace for their worst weeks since june of 22. as we are at session lows here at 5156. bob dole joins us crossmark global ceo and cio talk about this ongoing enduring selloff period. bob, good to see you again. thanks for joining us. >> hi carl. >> is there how do you construct a playbook given some of the rugs that have been pulled? >> so i think in the waterfall declines, you pay attention to the technicals. the fundamentals matter. but technicals first, we've only begun to see the put call issue become problematic. it's been very calm until the last couple of days. credit spreads until the last few days have been pretty tight. now you're starting to see in both cases things open up a bit, so there's some capitulation

creeping into the market. at some point we will get a tradeable rally, but we're not out of the woods. probability of recession has gone up. we're using 50%, started the year 25% earnings estimates. even before all this noise, carl and our view were too high. now for sure they have to come down. so i'm not convinced. we've yet seen the lows in the equity market. >> so with all of this, the sort of scary talk and recession worries and everything, if you were not adequately prepared or selling into liberation day, what do you do now? is it too late to reduce exposure. >> if you're way overweight equities? i don't think it's too late to back off. i will say in my portfolios, particularly the ones that i have to be fully invested. sarah, i am beginning to lean against the wind, for example, buy a little nvidia, sell a little coke doesn't mean all of it, but but coca-cola is now selling. i'm looking here 24 times forward earnings in nvidia

21 times. i think nvidia's long term growth rate is higher. i know that stocks technically damaged. i get all of that. but buying a few banks, selling some food and beverage at the margin. now if you don't have those things coming in, you can't really sell them. but trimming back on the stuff that is done so well and buying some of the things that have gotten damaged so good at the margin, i think makes sense. >> just because things have gotten cheap is what you're saying. >> yeah, yeah, they've gotten a lot cheaper and we don't know for sure. are we going to have a recession or not? and if we do, how much are we going to mark down earnings. look i can be really really bearish. let's suppose earnings this this year are $250 for the s&p which isn't a full recession. it's just economic weakness. and i get worried about multiples. and so i do i put an 18 on that do the multiplication. that's a four handle on the s&p 500. if we have a recession we will sure see a four handle. >> right, bob. we were already

keeping an eye on the lower income cohort and credit quality and delinquencies on autos and so forth, which we still are. but now we got to worry about the wealth effect and the top 10% of earners who do half the spending in this country. and i wonder if you would even touch a consumer name at the high or the low end. >> yeah, it's back to the list i just gave sarah. i'm nibbling on them. i'm not trying to be a hero, but i think some of those stocks have been damaged pretty hard where their fundamentals are in really good shape. look high end yes. going to get hurt a little bit. we really have to focus as you know, on middle income consumers. and they were squealing before all this period beginning to even see some signs of taking out credit card balances. et cetera. so economic weakness is for sure coming. the employment report didn't say that today obviously. but stay tuned. >> yeah. i mean, what about the argument that margins were near record highs. companies were

have been in hiring mode. they've been really good financial shape. we got that confirmed in the jobs report today. i mean how much of a cushion do you think there is here. >> not not a ton sarah. look, businesses and individuals, when they don't know the rules of the road. and we've had a period of maximum uncertainty. they pull their horns in some they stop hiring as many workers as they were going to hire. they defer a project. individuals, you know, toned down their vacation plans. you know how that goes. enough people do. it becomes a self-fulfilling prophecy. so economic weakness, you know, look what's happened in the last couple of weeks. earnings estimate, economic growth expectations have come down. call it by a point. these are round number and inflation number. expectations have moved up. call it by a point. that's not a good combination. >> finally bob ex tariffs just on on sentiment i wonder you know we were in this period on

ai spend and capex where everyone was full throttle. you had to get the assets before the next guy. how much of that gets unwound. would you be surprised to see some of the hyperscalers revise lower their capex guidance for the year? >> i wouldn't be surprised at all. look, i think this is a period that's going to be retrenching for almost everything. so maybe might i spend a little less money? remember in january we had the three biggest i investors add $200 billion collectively to their intended spending this year. some of that could be postponed over time without question. >> bob session lows once again. now goes down 1700 points. s&p down 276 points. thank you bob appreciate it. important day bob dole. >> hang in there. >> yeah. energy sector down more than 8% now. financials and industrials down more than six. we are getting some news from nintendo. let's get to steve

kovac steve. >> hey there sarah. yeah nintendo just sent out this statement telling me they are delaying preorders for their new switch two console due to tariff uncertainty. this was the console. they gave the full details on just two days ago. it was supposed to go on sale for preorder for $450 here in the united states and launch on june 5th. they're now pushing back the preorders, they say, as they try to figure out what this tariff situation means. nintendo does make its consoles in china. we know about that 54% tariff on imports from china happening right now. as for the price, they're not commenting if they're going to change the price or not. again, $450 is what they announced just a couple days ago, but unclear if that price is going to hold amid these tariffs. and for now, they're putting a pause on accepting those preorders because of this tariff uncertainty. guys, i'll send it back over to you. >> that adds a whole new dimension to this trade debate, steve, and we'll make news for a whole new audience. that's our

steve kovach. thank you. let's get a quick check on crypto this morning. holding pretty steady, actually in today's sell off and for the week trading at mid march. lows on the year down more than 10% and down nearly 25% from the 52 week high. within that space you got to watch robinhood and strategy. some of the biggest losers, but the whole group taking a leg lower along with the broader markets this week. meantime, in the last couple of moments got some tweets from lloyd blankfein. >> the former. >> ceo of goldman sachs. >> goldman yeah he's he's weighing in on the tariffs and the market action here. it's his first post on x this year. it's notable he wrote the switchboard at the white house must be burning up with governments trying to surrender in the trade war. why not give them a chance, make the 10% minimum tariff immediate, but defer the reciprocal part. six months. take the win. the president said he'd make us tired of winning. i'm there now. tired of winning. that is. and just i think it's another voice that is supportive and trying to get the white

house to negotiate. right. we heard this a little bit from steve mnuchin, the former treasury secretary under president trump. >> yesterday this morning. >> right. it's like 10% okay. makes the point. we want we want to level the playing field. but as far as those sky high tariff rates that are going to wreak havoc, negotiate them down because other governments will come in and they'll make deals and we'll get better, fairer trading terms. >> you hope. that's the point. some of the rhetoric out of france and germany has not been hopeful. in fact, there's headlines just now from france saying any response needs to be proportionate. and there's been no sense that there's a backing off of sorts. wouldn't you agree? >> i. yes. and i think that the leader should be calling president sheinbaum of mexico because she has handled this very well, seemingly. and there's been a lot of talk about the good relationship now between the us and mexican government. they did not get added tariffs on top of the fentanyl tariffs. and she seemingly has been working this very well. so maybe that's a good template that president macron should be calling her. >> watching the autos this

morning again moving lower looking to update their manufacturing plans. now under these new tariffs are phil lebeau has been watching that morning phil. >> good morning karl. rough week for the major auto makers. they are at 52 week lows. when you're looking at toyota as well as stellantis. also terrible week in terms of shareholders for ford and general motors all the auto makers. and they are assessing their production plans. what does that mean? i've talked to people who are in contact with some of the automakers. first thing you're going to see is the possibility of adding shifts, increasing run rates. we've already heard from a few automakers about that, moving some foreign made models to the united states. that's a little more involved, but that is certainly being discussed. and then finally, we could see the announcement of new assembly plants. in fact, one of the leading consultants working with some of the automakers has said he expects to see five of them this year. that's dennis cuneo, who has been doing it for a number of years. that's his expectation. remember, even if they're announced, it doesn't mean we see production right away. we were just down in

georgia for the new hyundai plant that was announced back in 21, started construction in 22. finally up and running here in 24. these are some of the robots that are there inside that plant. as you look at auto sales, that's where we're going to see the next implication in terms of the impact of tariffs. yes, it was a huge march, up 4.8%. and april is expected to be equally strong as people run out to buy a vehicle before tariffs potentially take effect and hurt pricing. but beyond that, we have yet to see the sales estimates for the full year come in. most believe that they're going to be dropped by maybe a million vehicles, but that's back of the envelope guessing at this point. the foreign automakers, we're keeping an eye on them because, look, they don't have much capacity here, guys. and if they're going to add something to offset the impact of the tariffs because they don't have the amount of production here, they're going to have to make a decision about adding assembly lines or new plants. >> i made note this morning, phil, on my blue sky account of

the page, the front page of the chicago sun times, which is a basically, you better buy your car now. the headline is buy now or pay more later. yeah, yeah. >> and we've heard from dealers they had a huge weekend last weekend. they're expecting this to continue at least for the next couple of weeks. >> and your sneakers and your avocados and your coffee. buy it all now i guess. >> phil, thank you. our phil lebeau, as we continue to watch this tape extremely closely, 5161 is obviously going to take you back past the august lows there for a moment. money movers is going to begin after this. >> cnbc crypto world is sponsored by crypto.com, trusted by over 100 million users worldwide. >> assured guarantees bond insurance was protecting investors and municipal green bonds before they were even bonds before they were even called green bonds at morgan stanley,

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that's just right. >> yes, yes. >> america has to be able to protect itself. we need to stop supporting the rest of the world and start supporting american workers. let me make this very clear. this is not a negotiation. this is not that. this is a national emergency. >> good friday morning. welcome to money movers. i'm carl quintanilla with sara eisen, live at post nine of the new york stock exchange. stocks are in sell off mode again at session lows. they're awfully close right now for the major averages. dow down 3.5%. s&p down 4% at 5168 nasdaq officially goes into a bear market watch. yields ten year has been below 4% of